The Hong Kong government has granted five new pay-TV licences in
the territory, bringing the potential number of channels on offer to 149
over the next six to 18 months.
Industry analysts said more TV players would create a further fragmented
TV scene in Hong Kong, where the market has been dominated by local
media powerhouse TVB.
Growing pay-TV households, lowered subscription fee, pressure on TV rate
hikes by terresterial stations, greater demand for quality programming
and more flexible TV packages will be some of the issues triggered by a
more open and competitive market scene, according to a MindShare
study.
The five licences have been given to Hong Kong Network TV, Elmsdale,
Pacific Digital Media, Hong Kong DTV Company and Galaxy Satellite
Broadcasting.
A total of 10 applications were submitted for the licences.
The five successful applicants will invest capital of HK$700
million (US$90 million) over the next three years in the pay-TV
and digital communications platform.
Currently, PCCWHKT's iTV and Wharf's Cable TV are the only pay-TV
operators in Hong Kong.
However, their share of the TV adspend pie is mimimal, with Cable TV
only taking up four per cent of the total TV adspend.
The government has also stipulated that in granting a licence to Galaxy,
which is owned by local terrestrial broadcaster TVB, neither parties are
permitted to engage in activities involving cross-subsidies or
preferential treatment. In addition, the beneficial ownership of TVB and
its associates in Galaxy must be below 50 per cent of total shareholding
of Galaxy.
Further consolidation will occur in the pay-TV scene, with industry
watchers keeping a close eye on TVB, Star TV and PCCWHKT's involvement
in Hong Kong's small broadcasting market, where doubts remain as to its
capacity.
